On Tuesday, Cox Digital Solutions (CDS) announced that it is adding a new brand, Appetite Media, to its portfolio of vertically-focused site networks. According to the release, Appetite Media will focus on offering "food lover" audiences to advertisers who also seek high-impact, "premium" placements. The company says that Appetite will bring together 22 million unique users per month as measured by comScore. Read the release.

Steve Shaw, president of Cox Digital Solutions, discussed his CDS unit and the Appetite Media announcement.

AdExchanger.com: First, can you frame for us where Cox Digital Solutions fits within Cox itself, and why?

SS: Sure. So a quick background - Cox Crossmedia is the company that I founded in July of 2007 and it was started as a division of Cox Reps, which includes TeleRep and HRP.

Cox Reps is the biggest TV representation firm in the industry with about a 40 share of the business out there for spot television representation.

Cox Crossmedia was founded to become the digital equivalent to the broadcast job that Cox Reps was doing. In effect - be a digital rep firm for all these local media sites.

As you probably know, Cox bought Adify in April of '08 and the two companies kind of operated in parallel thereafter – one a technology company and one a sales company. As Adify started getting into the sales arena, we began to look at each other and see some duplication of effort and resources.

In December of last year, we put the two companies together. Around the same time, we bought the sales arm of Internet Broadcasting, IB. And those companies together became Cox Digital Solutions (CDS), which is both a sales and a platform technology company.

We report up through Cox Reps and we're a part of Cox, under the Cox Media Group umbrella.

In terms of the Adify technology itself, is it “sprinkled,” if you will, within the CDS organization now?

It's more than sprinkled. We took the sales expertise side of the house, which was in the original Cox Crossmedia group and also developed some front end database technology, and then put that together with the Adify platform, where we have our own proprietary ad server and other cool tech.

The combination allows us to bring 2,000 local media sites that we're working with on the Cox Crossmedia side and the 6,000 sites or so that we're working with on the Adify side and offer the product in several different ways: specific verticals, such as Appetite Media; we use geo-targeted ads for both local media and national vertical sites in specific markets; and we also just launched the audience network a couple months ago.

We took the best of what the two companies had and combined it. That being said, we're only six months old, and we're still developing new products. But it seems so far to have been a really good marriage for us.

Looking at Appetite Media specifically, what was the trigger in creating that brand?

We have had a real strong partner in GourmetAds, which is a network of over 500 sites originally powered by Adify and now the CDS platform. That was a great point of entry for us. We want to be in the business of formalizing these verticals and be able to bring something with scale as well as provide a high impact placement-type business to the marketplace.

I also point out that this is our proof of concept, if you will. I think it's a strategy you'll see us roll out across other verticals as we move forward.

And so, where will these placements fit in within the network member publisher strategy? A guaranteed custom strategy or non‑guaranteed strategy?

It’s pretty much all inside of guaranteed. We're not doing non‑guaranteed. If we bring a program to market with a major advertiser, and specifically with high impact placements, we're not doing that unless we know we can comply and deliver.

If you aggregate these sites and deliver the product with a commonality across all of them, you can engage a lot of people who are very passionate about what they're doing. I think that's what advertisers are kind of latching on to.

With all the backlash you're starting to see with behavioral - that's going to get it's wings clipped at some point – it may always be there, but it's not going to be the be all and end all. I think the good old fashioned targeting against content that people are passionate about is going to be a very effective way to reach audiences. I think advertisers agree.

In terms of CDS and three screen strategy, how close are you to developing three screens for advertisers?

We've done it and we're looking to dramatically increase that offering.

Quite frankly, I think we're there before the marketplace is. There aren't a lot of agencies that are set up to evaluate and buy it that way. We're set up to sell it that way now, so I think it's actually really exciting for us.

Let's face it. We're usually chasers. The industry comes up with what they want - or the marketers do - and then we react to it and bring solutions to the table. I think we have a solution that we can do almost in a turnkey fashion right now that they're not ready to buy. So I think we can help them define that market and bring it out for them.

I'm a big believer in the walk before you run philosophy. So have we certainly tested this… And you know that's the Cox Reps advantage, is that we have 350 TV stations across the country. It's the largest footprint of spot TV stations anyone can bring to bear that we can mix and match with our digital products at any time.

I feel good about the fact that we can get there before anyone else.

From a strategic perspective, do you see an opportunity with exchanges and real time bidding within CDS strategy?

Yes and no. We have a real-time bidding technology. We're hooked up to some of the DSPs. It's a business that you can't ignore and you have to play in, but I think when you talk about it… that's one type of media buy that people are trying to do for clients.

Still, there's always going to be that need to do some of the high impact specialization, content integration, etc. So, we are players in [the RTB/exchanges] side of the business but there are different ways of buying audiences. I feel good about where we are in the market because we can do both. Certainly, the Appetite Media approach and custom verticals do not lend themselves as much to the RTB exchange model.